UK shop price inflation hits 2.1%, highest in two and a half years
British Retail Consortium says shop price inflation rose to 2.1% in October from 1.4% in September, with food at 2.9% and non-food at 1.7%.
What you need to know
The Guardian reports that UK shop price inflation rose to 2.1% year on year in October, the highest in two and a half years, up from 1.4% in September, according to the British Retail Consortium. Food inflation reached 2.9% and non-food inflation 1.7%, as retailers began passing on energy and ingredient costs.
- Shop price inflation was 2.1% year on year in October, up from 1.4% in September
- Food inflation rose to 2.9% from 2.5%; non-food more than doubled to 1.7% from 0.8%
- BRC chief executive Helen Dickinson said the dam was starting to break on absorbed costs
- Bank of England officials are expected to raise interest rates next week from 3.75% to 4%
- The figures come before chancellor John Healey's first budget on Wednesday
Retailers pass on costs
Shop price inflation climbed to 2.1% year on year in October, the highest in two and a half years, the British Retail Consortium said, according to The Guardian. That compares with 1.4% in September. Food inflation rose to 2.9% from 2.5%, while non-food inflation, which covers clothing and footwear, more than doubled to 1.7% from 0.8%.
The Guardian reports that until this month retailers had largely absorbed higher raw material costs, mainly because customer demand was weak. The BRC said retailers were beginning to pass on rising energy and food ingredient costs since the Middle East conflict broke out. Consumer confidence has declined sharply since the summer, the report said.
Rates and budget pressure
Bank of England officials are expected to raise interest rates next week from 3.75% to 4%, The Guardian reports. If retail price rises persist, the report said, many of the Bank's nine-member monetary policy committee are likely to be persuaded to raise rates further in December or the new year.
The figures add pressure on chancellor John Healey before his first budget on Wednesday. The Guardian also cites a University of Glasgow study by Ruth Patrick, based on interviews with low-income families, finding that high fuel prices affect families transporting disabled children and workers who drive to their jobs. Patrick said the budget offered a chance to secure the adequacy of social security.
What did the British Retail Consortium report about UK shop price inflation in October?
The BRC said shop price inflation was 2.1% year on year in October, up from 1.4% in September and the highest in two and a half years, with food at 2.9% and non-food at 1.7%.
Sources & context
- UK shop price inflation ‘highest since 2024’ as retailers struggle to limit price rises ↗The Guardian
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